INVESTMENT MANAGEMENT AGREEMENT
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AGREEMENT made as of the 30th day of October, 1992, and amended and
restated as of the 1st day of April, 1993, and the 6th day of December, 1994,
between XXXXXXXXX GLOBAL INCOME FUND, INC. (hereinafter referred to as the
"Company"), and XXXXXXXXX INVESTMENT COUNSEL, INC. (hereinafter referred to as
the "Manager").
WHEREAS, this Agreement was originally made between the Company and
Xxxxxxxxx Global Bond Managers, Inc. ("TGBM");
WHEREAS, TGBM is being merged with and into the Manager in a transaction
that will not result in a change of actual control or management with respect to
the Company's investment management arrangements;
WHEREAS, the purpose of this amendment and restatement is to identify the
Manager as the investment manager hereunder as a result of said transaction;
NOW THEREFORE, in consideration of the mutual agreements herein made, the
Company and the Manager understand and agree as follows:
(1) The Manager agrees, during the life of this Agreement, to manage
the investment and reinvestment of the Company's assets consistent with the
provisions of the Articles of Incorporation of the Company and the
investment policies adopted and declared by the Company's Board of
Directors. In pursuance of the foregoing, the Investment Manager shall make
all determinations with respect to the investment of the Company's assets
and the purchase and sale of its investment securities, and shall take all
such steps as may be necessary to implement those determinations.
(2) The Manager is not required to furnish any personnel, overhead
items or facilities for the Company.
(3) The Manager shall be responsible for selecting members of
securities exchanges, brokers and dealers (such members, brokers and
dealers being hereinafter referred to as "brokers") for the execution of
the Company's portfolio transactions consistent with the Fund's brokerage
policies and, when applicable, the negotiation of commissions in connection
therewith.
All decisions and placements shall be made in accordance with the
following principles:
1. Purchase and sale orders will usually be placed with brokers able
to achieve "best execution" of such orders. "Best execution" shall mean
prompt and reliable execution at the most favorable securities price. The
determination of what may constitute best execution and price in the
execution of a securities transaction by a broker involves a number of
considerations, including, without limitation, the overall direct net
economic result to the Company (involving both price paid or received and
any commissions and other costs paid), the efficiency with which the
transaction is effected, the ability to effect the transaction at all where
a large block is involved, availability of the broker to stand ready to
execute possibly difficult transactions in the future, and the financial
strength and stability of the broker. Such considerations are judgmental
and are weighed by the Manager in determining the overall reasonableness of
brokerage commissions.
2. In selecting brokers for portfolio transactions the Manager shall
take into account its past experience as to brokers qualified to achieve
"best execution," including brokers who specialize in any foreign
securities held by the Company.
3. The Manager is authorized to allocate brokerage and principal
business to brokers who have provided brokerage and research services, as
such services are defined in Section 28(e)(3) of the Securities Exchange
Act of 1934 (the "1934 Act"), for the Company and/or other accounts, if
any, for which the Manager exercises investment discretion (as defined in
Section 3(a)(35) of the 0000 Xxx) and, as to transactions in which fixed
minimum commission rates are not applicable, to cause the Company to pay a
commission for effecting a securities transaction in excess of the amount
another broker would have charged for effecting that transaction, if the
Manager determines in good faith that such amount of commission is
reasonable in relation to the value of the brokerage and research services
provided by such broker, viewed in terms of either that particular
transaction or the Manager's overall responsibilities with respect to the
Company and the other accounts, if any, as to which it exercises investment
discretion. In reaching such determination, the Manager will not be
required to place or attempt to place a specific dollar value on the
research or execution services of a broker or on the portion of any
commission reflecting either of said services. In demonstrating that such
determinations were made in good faith, the Manager shall be prepared to
show that all commissions were allocated and paid for purposes contemplated
by the Company's brokerage policy; that the research services provide
lawful and appropriate assistance to the Manager in the performance of its
investment decision-making responsibilities; and that the commissions paid
were within a reasonable range. Whether commissions were within a
reasonable range shall be based on any available information as to the
level of commission known to be charged by other brokers on comparable
transactions, but there shall be taken into account the Company's policies
that (i) obtaining a low commission is deemed secondary to obtaining a
favorable securities price, since it is recognized that usually it is more
beneficial to the Company to obtain a favorable price than to pay the
lowest commission; and (ii) the quality, comprehensiveness and frequency of
research studies that are provided for the Manager are useful to the
Manager in performing its advisory activities under this Agreement.
Research services provided by brokers to the Manager are considered to be
in addition to, and not in lieu of, services required to be performed by
the Manager under this Agreement.
(4) The Company shall pay to the Manager a monthly fee in dollars at
an annual rate of 0.55% of the Company's average daily net assets, up to
$200 million and 0.50% of the Company's average daily net assets in excess
of $200 million, payable at the end of each calendar month.
(5) This Agreement shall become effective on October 30, 1992 and
shall continue in effect until December 31, 1993. If not sooner terminated,
this Agreement shall continue in effect for successive periods of 12 months
each thereafter, provided that each such continuance shall be specifically
approved annually by the vote of a majority of the Company's Board of
Directors who are not parties to this Agreement or "interested persons" (as
defined in Investment Company Act of 1940 (the "1940 Act")) of any such
party, cast in person at a meeting called for the purpose of voting on such
approval and either the vote of (a) a majority of the outstanding voting
securities of the Company, as defined in the 1940 Act, or (b) a majority of
the Company's Board of Directors as a whole.
(6) Notwithstanding the foregoing, this Agreement may be terminated by
either party at any time, without the payment of any penalty, on sixty (60)
days' written notice to the other party, provided that termination by the
Company is approved by vote of a majority of the Company's Board of
Directors in office at the time or by vote of a majority of the outstanding
voting securities of the Company.
(7) This Agreement will terminate automatically and immediately in the
event of its "assignment" (as defined in the 1940 Act).
(8) In the event this Agreement is terminated and the Manager no
longer acts as Manager to the Company, the Manager reserves the right to
withdraw from the Company the use of the name "Xxxxxxxxx" or any name
misleadingly implying a continuing relationship between the Company and the
Manager or any of its affiliates.
(9) The Manager may rely on information reasonably believed by it to
be accurate and reliable. Except as may otherwise be provided by the 1940
Act, neither the Manager nor its officers, directors, employees or agents
shall be subject to any liability for any error of judgment, mistake of
law, or any loss arising out of any investment or other act or omission in
the performance by the Manager of its duties under the Agreement or for any
loss or damage resulting from the imposition by any government of exchange
control restrictions which might affect the liquidity of the Fund's assets,
or from acts or omissions of custodians or securities depositories, or from
any war or political act of any foreign government to which such assets
might be exposed, except for any liability, loss or damage resulting from
willful misfeasance, bad faith or gross negligence on the Manager's part or
by reason of reckless disregard of the Manager's duties under this
Agreement.
(10) It is understood that the services of the Manager are not deemed
to be exclusive, and nothing in this Agreement shall prevent the Manager,
or any affiliate thereof, from providing similar services to other
investment companies and other clients, including clients which may invest
in the same types of securities as the Company, or, in providing such
services, from using information furnished by others. When the Manager
determines to buy or sell the same security for the Company that the
Manager or one or more of its affiliates has selected for clients of the
Manager or its affiliates, the orders for all such securities transactions
shall be placed for execution by methods determined by the Manager, with
approval by the Company's Board of Directors, to be impartial and fair.
(11) This Agreement shall be construed in accordance with the laws of
the State of Maryland, provided that nothing herein shall be construed as
being inconsistent with applicable Federal or state securities laws or any
rules, regulations or orders thereunder.
(12) If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby and, to this extent, the provisions
of this Agreement shall be deemed to be severable.
(13) Nothing herein shall be construed as constituting the Manager an
agent of the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers and their respective corporate
seals to be hereunto duly affixed and attested.
XXXXXXXXX GLOBAL INCOME FUND, INC.
By: /s/ Xxxx X. Xxx
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Xxxx X. Xxx
Vice President
XXXXXXXXX INVESTMENT COUNSEL, INC.
By: /s/ Xxxxxxx X. XxXxxxx
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Xxxxxxx X. XxXxxxx
Executive Vice President
